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Old 10-15-2008, 05:50 PM   #21
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Thanks! That was interesting. Sounds like a terrific deal for early retirees younger than 59 1/2. That is definitely a bit of good news.

Also, I noticed that Obama and McCain both back the temporary elimination of RMD's. Good.
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Old 10-15-2008, 05:54 PM   #22
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W2R, can't early retires use 72T under 59 1/2? What's so good about it? I think this is for people who are still working.
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Old 10-15-2008, 06:18 PM   #23
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Originally Posted by 73ss454 View Post
W2R, can't early retires use 72T under 59 1/2? What's so good about it? I think this is for people who are still working.
The difference is that with 72(t), you have to use SEPP AND do it for five years or until 59 1/2, whichever is longer. With this you could withdraw when you saw fit, not according to SEPP and no requirement to continue SEPP until a certain point in time.
"Hey, for every ten dollars, that's another hour that I have to be in the work place. That's an hour of my life. And my life is a very finite thing. I have only 'x' number of hours left before I'm dead. So how do I want to use these hours of my life? Do I want to use them just spending it on more crap and more stuff, or do I want to start getting a handle on it and using my life more intelligently?" -- Joe Dominguez (1938 - 1997)
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Old 10-15-2008, 08:08 PM   #24
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Originally Posted by ziggy29 View Post
In reality, a properly constructed portfolio shouldn't have to draw the RMD from stocks, but I guess that's beside the point. I think retirees should always have several years of withdrawals in "safer" stuff, and in times when the stock market is beaten down they can withdraw from the less volatile assets.

Someone who needs to sell stocks to meet an RMD in a bad market is *probably* invested way too aggressively.
That's exactly the thought I had when I heard that. It's becoming very clear to me that there are a lot of people out there that are mismanaging their portfolios (or having them mismanaged for them) and are paying a price for that, especially in this bear market. Granted they're anecdotes, but I've heard one story after another about some retiree who's down 30%+ (when they should be down maybe 8-16% with a reasonable AA) and now this one implying that there are a bunch of 70+ yr old folks who are being forced to sell stocks.
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